Cash component Gsec query

Hi @Dhan team,

Can you pls tell me why am I not able to find out the G-Secs listed in your pledge sheet. Instead all I can see is FnO options for it, not even sure if FnO exists for G-Secs… pls have a look at screenshot below… it even lists the call options for the G-sec

Hi @erankitjain,

We are getting this checked and will update you soon.

@erankitjain You can find the 610GS2031 security with the name “GOI LOAN 6.10% 2031”. We have used custom symbol name for underlying securities so that nomenclature discrepancy does not affect the users. Nomenclature logics change at exchange level which brings in confusion. Just type “GOI LOAN” on the search bar and you will get all the Government Securities listed.

Secondly, there do exist futures and options of some of these government securities and they are collectively classified as “Interest Rate Futures” (this is hardly known as this segment has very low liquidity)

thanks @iamshrimohan for this info… fno for G-sec is something I never knew! :sweat_smile:

Also, can I pledge any “GOI LOAN XXX” holding as cash component or only the which is listed on Dhan Gsheet? If not, then any particular reason for it?

@erankitjain Happy to help! The sheet gets updated, which might include the pending ones as well (subject to liquidity). For now, only those listed on the sheet can be pledged.

The reason for this is liquidity. Government Securities are newly introduced to retail participants hence they have comparatively low participation and thus liquidity. So only when a particular security is traded with good volume and gets a market depth, we enable it to be pledged.

got it… thank you for such detailed explanation… all clear!

Hi @iamshrimohan

Came across this fund which primarily invests in govmnt securities

Will this be considered a cash component ?

Since DHAN does not have provision to apply in primary markets in GOi and t bill .

I mean once we have mutual funds on DhAn , can this be bought and pledged ?

Hi @pavz ideally yes. If a Fund / ETF is dealing in only government securities, it will be considered as CASH component. However, being classified as CASH or NON-CASH depends on the Clearing Corporation. So on 20th of every month, NSE issues a list of approved securities with clear classification as CASH or NON-CASH along with applicable haircut. If exchange for any reason classified that particular ETF / Fund as NON-CASH, we have to abide with it.

We as broker follow the SAME classification for CASH and NON-CASH but do change the haircut based on risk parameters. For example, a GSEC has a standard haircut of 10% but a fund/ETF which deals only in that Gsec might not get 10% haircut due to its liquidity and other parameters.

3 Likes

Hi @iamshrimohan

within the find & margin summary page in Dhan Web, Is there any option to see how much of our pledged amount is cash VS non-cash. I can see Collateral Equity, but there is no classification. I have LIC MF G-Sec Long Term ETF, which is listed as to be considered as a cash component, but couldn’t see it clearly in the margin summary page.

1 Like

Cool, love the way you give a clear explanation :+1::white_check_mark:

1 Like

Hi @kbkalyani56 as of now this is not there but we explore if that can be added (if not real-time, maybe as of EOD).

Thanks @pavz ! Happy to help!

1 Like